```

[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5014 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 5014

   To amend the Internal Revenue Code of 1986 to provide a one-time 
   exclusion of gain from the sale of farmland to a beginning farmer.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                            August 21, 1994

Mr. Lightfoot introduced the following bill; which was referred to the 
                      Committee on Ways and Means

_______________________________________________________________________

                                 A BILL

 
   To amend the Internal Revenue Code of 1986 to provide a one-time 
   exclusion of gain from the sale of farmland to a beginning farmer.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. ONE-TIME EXCLUSION OF GAIN FROM SALE OF FARMLAND TO 
              BEGINNING FARMER.

    (a) In General.--Part III of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to items specifically excluded 
from gross income) is amended by inserting after section 121 the 
following new section:

``SEC. 121A. ONE-TIME EXCLUSION OF GAIN FROM SALE OF FARMLAND TO 
              BEGINNING FARMER.

    ``(a) General Rule.--In the case of an individual, at the election 
of the taxpayer, gross income does not include gain from the sale or 
exchange of property if--
            ``(1) the taxpayer has attained the age of 55 before the 
        date of such sale or exchange,
            ``(2) during the 8-year period ending on the date of the 
        sale or exchange, such property--
                    ``(A) was owned by the taxpayer, and
                    ``(B) was used by any person as a farm for farming 
                purposes (as defined in section 2032A(e)), and
            ``(3) such property is acquired from the taxpayer by a 
        beginning farmer.
The requirement of paragraph (2)(B) shall be treated as met only if, 
for periods aggregating 3 years or more during such 8-year period, such 
use was by the taxpayer.
    ``(b) Application to Only 1 Sale or Exchange.--Subsection (a) shall 
not apply to any sale or exchange by the taxpayer if an election by the 
taxpayer or his spouse under subsection (a) or section 121 with respect 
to any other sale or exchange is in effect. The preceding sentence 
shall be applied by not taking into account any election referred to in 
section 121(b)(3) and any election under section 121 with respect to 
the principal residence of the taxpayer which is acquired by the 
beginning farmer who acquired the property referred to in subsection 
(a).
    ``(c) Election.--An election under subsection (a) may be made or 
revoked at any time before the expiration of the period for making a 
claim for credit or refund of the tax imposed by this chapter for the 
taxable year in which the sale or exchange occurred, and shall be made 
or revoked in such manner as the Secretary shall by regulations 
prescribe. In the case of a taxpayer who is married, an election under 
subsection (a) or a revocation thereof may be made only if his spouse 
joins in such election or revocation.
    ``(d) Beginning Farmer.--For purposes of this section, the term 
`beginning farmer' has the meaning given such term by section 
343(a)(11) of the Consolidated Farm and Rural Development Act (7 U.S.C. 
1991).
    ``(e) Special rules.--Rules similar to the rules of paragraphs (1), 
(2), and (6) of section 121(d) shall apply for purposes of this 
section.''
    (b) Clerical Amendment.--The table of sections for such part III is 
amended by inserting after the item relating to section 121 the 
following new item:

                              ``Sec. 121A. One-time exclusion of gain 
                                        from sale of farmland to 
                                        beginning farmer.''
    (c) Effective Date.--The amendments made by this section shall 
apply to sales and exchanges after the date of the enactment of this 
Act in taxable years ending after such date.
                                 <all>
```